Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
11) Equity financing is preferred for related diversification while debt financing is preferred for
unrelated diversification.
Answer: TRUE
12) In a leveraged buy-out, the acquired company, in effect, pays for its own acquisition.
Answer: TRUE
13) An example of the use of the leader R&D functional strategy to achieve a low-cost
competitive advantage is Dean Foods Company.
Answer: FALSE
14) An operations strategy determines how and where a product or service is to be manufactured,
the level of vertical integration in the production process, the deployment of physical resources,
and relationships with suppliers.
Answer: TRUE
15) The continuous improvement system was developed in China.
Answer: FALSE
16) The automobile industry is currently experimenting with the strategy of mass customization
in which pre-assembled sub-assemblies are delivered as they are needed to a company's
assembly line workers.
Answer: FALSE
17) The importance of sole sourcing was supported by Michael Porter to obtain high supplier
quality.
Answer: FALSE
18) Two suppliers are the sole suppliers of two different parts, but they are also backup suppliers
for each others parts in parallel sourcing.
Answer: TRUE
19) Logistics strategy deals with the flow of products into and out of the manufacturing process.
Answer: TRUE
20) Research indicates that the use of work teams leads to increased quality and productivity as
well as higher employee satisfaction and commitment.
Answer: TRUE
2
Copyright 2015 & 2016 Pearson Education, Inc.
21) The follow-the-moon management philosophy allows project team members living in one
country to pass their work to team members in another country in which the work day is just
beginning.
Answer: FALSE
22) Outsourcing is the reverse of vertical integration.
Answer: FALSE
23) The key to outsourcing is to purchase from outside only those activities that are not key to
the company's distinctive competencies.
Answer: TRUE
24) Fujitsu demonstrated a strategy to avoid when it imitated IBM's strategy in 1990.
Answer: TRUE
25) Corporate scenarios are pro forma balance sheets and income statements that forecast the
effect each alternative strategy and its various programs will likely have on division and
corporate return on investment.
Answer: TRUE
26) Risk is composed not only of the probability that the strategy will be effective, but also of the
amount of assets the corporation must allocate to that strategy and the length of time the assets
will be unavailable for other uses.
Answer: TRUE
27) Chevron uses the real-options approach for bidding on petroleum reserves.
Answer: TRUE
28) The attractiveness of a strategic alternative is seldom affected by its perceived compatibility
with the key stakeholders in a corporation's task environment.
Answer: FALSE
29) If the strategy is incompatible with the corporate culture, the likelihood of its success is very
low.
Answer: TRUE
30) Even the most attractive strategic alternative might not be selected if it is contrary to the
needs and desires of important top managers.
Answer: TRUE
3
Copyright 2015 & 2016 Pearson Education, Inc.
31) Some executives show a self-serving tendency to attribute the firm's problems not to their
own poor decisions, but to environmental events out of their control such as government policies
or a poor economic climate.
Answer: TRUE
32) There is mounting evidence that when an organization is facing a dynamic environment, the
best strategic decisions are arrived at through consensus when everyone agrees on one
alternative.
Answer: FALSE
33) "The customer is always right" is an example of a policy in Nordstrom's.
Answer: TRUE
34) Which strategy is developed to pull together the various activities and competencies of each
department so that corporate and business unit performance improves and resource productivity
is maximized?
A) business strategy
B) competitive strategy
C) generic strategy
D) enterprise strategy
E) functional strategy
35) The pricing, selling, and distributing of a product is referred to as a(n) ________ strategy.
A) marketing
B) functional
C) operations
D) financial
E) human resource management
36) The type of marketing strategy in which a company captures a larger share of an existing
market for current products through market saturation or market penetration or develops new
markets for current products is called
A) market development.
B) push strategy.
C) product development.
D) pull strategy.
E) skimming the cream.
37) When Smith & Wesson puts its name on others' products like men's cologne, it is using
which marketing strategy?
A) demand pricing
4
Copyright 2015 & 2016 Pearson Education, Inc.
B) brand pricing
C) line extension
D) penetration extension
E) demand extension
38) A company may use which of the following trade promotions to "push" their products
through the distribution system?
A) discounts
B) in-store special offers
C) advertising allowances
D) coupons
E) brand advertising
39) When a company spends a large amount of money on trade promotion in order to gain or
hold shelf space in retail outlets, a company is using a ________ strategy.
A) pull
B) push
C) lengthening
D) knot
E) hold
40) Which type of pricing takes advantage of the demand curve while the product is still novel
and competitors are few?
A) demand pricing
B) competitive pricing
C) skim pricing
D) penetration pricing
E) loss-leader pricing
41) Which type of pricing attempts to hasten market development and offers the pioneer the
opportunity to utilize the experience curve to gain market share and dominate the industry?
A) demand pricing
B) competitive pricing
C) skim pricing
D) penetration pricing
E) loss-leader pricing
42) Which of the following is NOT a goal of financial strategies?
A) Examine the financial implication of corporate and business level strategic options and
identify the best financial course of action.
5
Copyright 2015 & 2016 Pearson Education, Inc.
B) Provide the corporation with the appropriate financial structure and funds to achieve its
overall objectives.
C) Institute a new product development plan to generate profit potential.
D) Provide competitive advantage through a lower cost of funds and a flexible ability to raise
capital to support a business strategy.
E) Attempt to maximize the financial value of the firm.
43) All of the following are benefits for a company to raising its debt levels EXCEPT
A) deterrent to takeover by other firms.
B) improvement in productivity.
C) improvement in cash flows.
D) force management to focus on core businesses.
E) increase in shareholder value.
44) A popular financial strategy in which a company is acquired in a transaction financed largely
by debt eventually paid off with money generated from the acquired company's operations or by
sale of its assets is
A) illegal in most countries.
B) a good way to build a core competency.
C) an application of the capital asset pricing model.
D) the leveraged buyout.
E) an example of internal financing.
45) Leveraged buyouts are also referred to as
A) leveraged bargains.
B) management buyouts.
C) management bargains.
D) coordinated buyouts.
E) debt buyouts.
46) When a company exchanges 100 shares of stock worth $10 each for 50 shares worth $20
each, they are using
A) tracking stock.
B) holding stock.
C) an LBO.
D) reverse stock split.
E) split stock.
47) The strategy that deals with product and process innovation and improvement is known as a
________ strategy.
A) marketing
6
Copyright 2015 & 2016 Pearson Education, Inc.
B) R&D
C) operations
D) financial
E) human resource management
48) A company which pioneers an innovation is called a(n)
A) technological follower.
B) technological opportunist.
C) technological leader.
D) technological manufacturer.
E) technological entrepreneur.
49) A company which imitates the products of competitors is referred to as a(n)
A) technological follower.
B) technological opportunist.
C) technological leader.
D) technological manufacturer.
E) technological entrepreneur.
50) When Intel opened four small-scale research facilities adjacent to universities to promote the
cross-pollination of ideas, they were using which approach to R&D?
A) open innovation
B) differentiation
C) technology scouts
D) continuous improvement
E) technological leadership
51) According to Porter, to achieve a cost advantage by following the functional strategy of
technological followership, a business unit should
A) pioneer the lowest-cost product design.
B) innovate in other activities to increase buyer value.
C) avoid R&D costs through imitation.
D) create low-cost ways of performing value activities.
E) be the first firm down the learning curve.
52) According to Porter, to achieve a differentiation competitive strategy by following the
functional strategy of technological leadership a business unit should
A) pioneer the lowest-cost product design.
B) innovate in other activities to increase buyer value.
C) avoid R&D costs through imitation.
D) create low-cost ways of performing value activities.
7
Copyright 2015 & 2016 Pearson Education, Inc.
63) The purchasing strategy in which the purchasing company orders a particular part from
several vendors is
A) sole sourcing.
B) multiple sourcing.
C) just-in-time sourcing.
D) backup sourcing.
E) parallel sourcing.
64) The concept of ________ was taken one step further in JITII, in which vendor sales
representatives usually have desks next to the purchasing company's factory floor, attend
production status meetings, visit the R&D lab, and analyze the purchasing company's sales
forecasts.
A) multiple sourcing
B) outsourcing
C) sole sourcing
D) parallel sourcing
E) all of the above
65) The purchasing strategy in which two suppliers are the sole suppliers of different parts, but
are also the backup suppliers for each other's parts is
A) sole sourcing.
B) multiple sourcing.
C) just-in-time sourcing.
D) backup sourcing.
E) parallel sourcing.
66) Three trends are evident in logistics: outsourcing, the use of the Internet, and
A) centralization.
B) downsizing.
C) logistical partnerships.
D) computerization.
E) containerized shipping.
67) The flow of products into and out of the manufacturing process is a factor when developing a
________ strategy.
A) marketing
B) logistics
C) operations
D) financial
E) human resource management
10
Copyright 2015 & 2016 Pearson Education, Inc.
D) do everything
E) losing hand
79) A company which has invested so heavily in a particular strategy that it will not consider a
change in this strategy even if it is not successful, would be an example of which strategy to
avoid?
A) follow the leader
B) hit another home run
C) arms race
D) do everything
E) losing hand
80) When considering acceptable alternative strategies, the most important criterion is the ability
of the proposed strategy to deal with
A) the prospects of ensuring profitable return on investment.
B) the specific strategic factors developed in the S.W.O.T. analysis.
C) defining the competitive environment in which the firm is competing.
D) the future long-term prospects of the industry.
E) governmental regulations and requirements placed on the industry.
81) The technique used to help strategic managers choose among alternative choices by defining
the task environment, developing a set of various forecasts, and using pro forma financial
statements is called
A) decision trees.
B) S.W.O.T. analysis.
C) industry scenarios.
D) corporate scenarios.
E) Capital Asset Pricing Model.
82) The first step in constructing a corporate scenario is to
A) develop a common-sized financial statement.
B) construct detailed pro forma financial statements.
C) decide upon how much risk management is willing to accept.
D) analyze the societal environment.
E) use industry scenarios to develop a set of assumptions about the task environment.
83) Which one of the following is NOT true of risk?
A) It is composed of the length of time the asset will be unavailable for other uses.
B) It is the probability that the strategy will be effective.
C) Managers who own a significant amount of stock in their firms are less likely to engage
in risk-taking actions.
13
Copyright 2015 & 2016 Pearson Education, Inc.
B) political strategy.
C) competitive strategy.
D) marketing strategy.
E) profit strategy.
89) If there is little fit between a strategic alternative under consideration and the corporate
culture, which of the following is one of the considerations that must be taken into account?
A) Take a chance on ignoring the culture by implementing the strategic alternative.
B) Manage around the culture and change the implementation plan.
C) Try to change the culture to fit the strategy.
D) Change the strategy to fit the culture.
E) All of the above.
90) Cultural backgrounds affect strategic choices. Korean executives emphasize ________ in
their decisions; whereas U.S. executives emphasize ________.
A) projected demand, discounted cash flow, and ROI; industry attractiveness, sales and market
share
B) Industry attractiveness, sales and market share; projected demand, discounted cash
flow, and ROI
C) Ego; industry attractiveness
D) Maintaining the status quo; change
E) none of the above
91) The evaluation of alternative strategies and selection of the best alternative is referred to as
A) alternative generation.
B) strategic implementation.
C) strategic choice.
D) strategic selection.
E) evaluation.
92) According to the text, unanimous agreement is not the best way to determine the merits of a
proposed alternative strategy. To avoid this consensus trap, which technique assigns a group or
individual to identify potential pitfalls and problems with a proposed alternative strategy in a
formal presentation?
A) devil's advocate
B) Sloan's judgment
C) sales presentation
D) dialectical inquiry
E) scenario construction
15
Copyright 2015 & 2016 Pearson Education, Inc.
93) According to the text, unanimous agreement is NOT the best way to determine the merits of
a proposed alternative strategy. To avoid this consensus trap, which technique involves
presenting two conflicting views (the thesis and the antithesis) presented in a debate format?
A) devil's advocate
B) Sloan's judgment
C) sales presentation
D) dialectical inquiry
E) scenario construction
94) Once the best strategic alternative is selected, the broad guidelines for its implementation are
then defined by
A) trade-offs.
B) policies.
C) procedures.
D) resource allocation.
E) strategic options.
95) When crafted correctly, an effective policy accomplished all but which of the following?
A) It forces trade-offs between competing resource demands.
B) It tests the strategic soundness of a particular action.
C) It grants employees freedom to experiment within its constraints.
D) It sets boundaries within which employee must operate while granting them freedom to
experiment within those constraints.
E) All of the above
96) What is a functional strategy?
Answer:
Functional strategy is the approach a functional area takes to achieve corporate and
business unit objectives and strategies by maximizing resource productivity. It is
concerned with developing and nurturing a distinctive competence to provide a company
or business unit with a competitive advantage.
101) What is outsourcing? What are the seven major outsourcing errors that should be avoided?
Answer:
Outsourcing is purchasing from someone else a product or service that had been previously
provided internally. It is the reverse of vertical integration. Outsourcing is becoming an
increasingly important part of strategic decision making and an important way to increase
efficiency and often quality.
The seven major outsourcing errors that should be avoided are as follows:
1. Companies failed to keep core activities in house.
2. Companies selected the wrong vendor - those that were not trustworthy or lacked stateof-the-art processes.
17
Copyright 2015 & 2016 Pearson Education, Inc.
3. Companies failed to write an effective contract establishing the balance of power in the
relationship.
4. Companies overlooked personnel issues - resulting in employees losing commitment to
the firm.
5. Management lost control over the outsourced activity.
6. Companies overlooked the hidden costs of outsourcing
7. Companies failed to plan an exit strategy (such as reversibility clauses).
103) What is a corporate scenario? What are the three steps in their construction?
Answer:
Corporate scenarios are pro forma balance sheets and income statements that forecast the
effect each alternative strategy and its various programs will likely have on division and
corporate return on investment. To construct a corporate scenario, the following three
steps should be taken.
1. Use industry scenarios to develop a set of assumptions about the task environment.
2. Develop common-size financial statements for the company's or business unit's previous
years, to serve as the basis for the trend projections of pro forma financial statements.
3. Construct detailed pro forma financial statements for each strategic alternative.
18
Copyright 2015 & 2016 Pearson Education, Inc.
104) In evaluating a strategic alternative, if there is little fit with the company's culture, what are
management's options?
Answer:
In evaluating a strategic alternative, management must consider corporate culture
pressures and assess the strategy's compatibility with the corporate culture. If there is little
fit, management must decide if it should take a chance on ignoring the culture, manage
around the culture and change the implementation plan, try to change the culture to fit the
strategy, or change the strategy to fit the culture.
19
Copyright 2015 & 2016 Pearson Education, Inc.